Prime Plastic pursues scrap for recycling

By: Frank Esposito

May 23, 2013

VISTA, CALIF. — Prime Plastic Products Inc. is not waiting for recycling sources to show up — it's going to them.

The Vista, Calif.-based recycling firm already has grinding units in place at three processors' locations and plans to have two more installed by the end of the year. The firm now generates about half of its recycling volume from units in place at those existing locations.

"Sourcing is the 800-pound gorilla in the room," Prime owner and founder Vince Gupta said in a recent phone interview. "We realized we could have one facility in one part of the country, but the country is so large and there's [plastic] scrap everywhere. You'd be depending on one geographic area to feed a plant."

Grinders could be installed with processors "for limited capital investment, once you were able to develop relationships with customers," he added. "And some were willing because you're saving them money."

Prime purchases and installs the grinders, then gathers the material and distributes it directly from those sites to other customers, most of which are in the Midwest. This approach saves the step of taking the material to a central warehouse location. The only warehouse owned by the firm is a 35,00-square-foot location in Maywood, near Los Angeles. That site also operates two grinders.

Gupta provided some detail on the firms where Prime has grinders in place, but he declined to identify them by name, citing confidentiality agreements. The Iowa firm is a toll grinder, while the North Carolina firm is an injection molder and the client in Missouri is a profile extruder.

Looking ahead, Gupta said he'd like Prime to do more sourcing business with toll grinders and smaller grocery chains, such as those with fewer than 100 locations. Prime potentially could install baling equipment at grocery stores to assist in the supply process.

Prime has found a niche by staying away from the bottle and film recycling that's done by many other recyclers, Gupta said. Instead, the firm has focused on recycling "big bulk rigids" such as pallets, totes, jugs, bins and drums. Most of these products are made from commodity resins, such as polyethylene and poly¬propylene.

In his native India, Gupta's family was involved in injection molding and other types of plastics processing. He moved to the U.S. in the early 1990s to attend Eastern Michigan University, where he earned a plastics engineering degree.

After graduating, Gupta worked for a couple of materials companies in Michigan before moving to California and going out on his own in the late 1990s. Prime now employs 10, with Gupta planning to hire three to five more people by the end of the year to work in sourcing.

Prime processes between 50 million and 60 million pounds of recycled resin per year, with a goal of reaching 100 million pounds, Gupta said. The firm posted sales of $12 million in 2012 and expects that amount to increase to $15-18 million this year.

Interest in using recycled-content plastics is growing in a number of markets, according to Gupta. "It's a happy blend," he said. "Big companies want to save money [by using recycled content] because of resin costs, and it also appeals to customers by allowing them to say that their product is a green product.

"The most positive thing about plastics recycling is that the material really has value now," Gupta added. Scrap plastic "used to be given away for free or for 1 cent per pound. Now, demand is up and supply hasn't kept pace."

After 15 years in business, Gupta said he's proud of what Prime has accomplished in the recycling market.

"We're debt-free and we've distinguished ourselves by not growing out of proportion just to chase volume," he said.